Archive for April, 2013

Why the Trans Pacific Partnership Would Hurt American Manufacturers

Tuesday, April 30th, 2013

The Obama Administration has continued negotiations on the Trans-Pacific Partnership agreement behind doors closed to the media and without the Congressional involvement that was requested by Congress. Besides being a threat to our national sovereignty as I discussed in a previous blog, it is time to shine the light on another egregious provision that would hurt American manufacturers.

The Buy American Act was passed by Congress in 1933 and required the U.S. government to give preferential treatment to American producers in awarding of federal contracts. The Act restricted the purchase of supplies that are not domestic end products. For manufactured products, the Buy American Act used a two-part test:  first, the article must be manufactured in the U.S., and second, the cost of domestic components must exceed 50 percent of the cost of all its components. Other federal legislation passed since extended similar requirements to third-party purchases that utilize federal funds, such as highway and transit programs.

“Buy American” provisions do not help all U.S. firms equally. Corporations headquartered in the U.S. that offshore most of their manufacturing operations do not benefit from the system designed to promote domestic production in the way that companies with actual U.S. manufacturing operations do. However, strengthening the “Buy American” provisions in our federal procurement system is one of the recommendations I made in my book to benefit American manufacturers and help save American manufacturing.

If a domestic producer offers the government a more expensive bid than a foreign producer, it can still be awarded the contract under certain circumstances, but more recent free trade agreements have granted other nations the same negotiating status as domestic firms.

In certain government procurements, the requirements may be waived if purchasing the material/parts domestically would burden the government with an unreasonable cost, as when the price differential between the domestic product and a identical foreign-sourced product exceeds a certain percentage, or the product is not available domestically in sufficient quantity or quality, or if doing so is not in the public interest. In recent years, the requirements have been increasingly waived to the point that we have lost domestic sources for some defense components and products.

In addition, the President has authority to waive the Act in response to the provision of reciprocal treatment to U.S. producers. Under the 1979 GATT Agreement on Government Procurement, the U.S.-Israel Free Trade Agreement, the U.S.-Canada Free Trade Agreement, the North American Free Trade Agreement, the Central American Free Trade Agreement, and the Korea Free Trade Agreement, access to government procurement by certain U.S. agencies of goods for the other parties to these agreements is granted. Every one of these trade agreements have increased the trade deficit that the U.S. has with the parties to these agreements.

The Obama administration is currently pushing to grant the several nations involved in the Trans-Pacific agreement the same privileged status. What this means is that the TPP’s procurement chapter would require that all companies operating in any country signing the agreement be provided access equal to domestic firms to U.S. government procurement contracts over a certain dollar threshold. To meet this requirement, the U.S. would have to agree to waive Buy America procurement policies for all companies operating in TPP countries.
Supporters of TPP argue that it would be good for America because these rules would apply to all the countries signing the agreement, so U.S. firms would be able to bid on procurements contracts in other countries on a national treatment basis. The question is whether this new access for some U.S. companies to bid on contracts in the TPP countries is a good trade-off for waiving Buy America preferences on U.S. procurement?

Lori Wallach of Public Citizen has written several articles warning about the dangers of the Trans-Pacific Partnership. In an article titled, TPP Government Procurement Negotiations:

Buy American Policy Banned, a Net Loss for the U.S., she points out that the total U.S. procurement market is more than seven times the size of the combined procurement market of the current TPP negotiating parties: Australia, Brunei, Chile, Malaysia, New Zealand, Peru, Singapore, and Vietnam. But the United States already has trade deals with procurement provisions with six of these countries: Australia, Canada, Chile, Mexico, Peru and Singapore. Removing these countries would mean that the U.S. procurement market is 24 times the size of the total “new” TPP procurement market.

She concludes “the size of the new procurement markets that the TPP may open for the United States is in the order of $53 billion (national) to $72 billion (total), which is a terrible trade for giving up the U.S procurement market of $556 billion (federal) to $1.7 trillion (total).”

In addition, she notes that the TPP procurement rules would constrain how our national and state governments may use our tax dollars in local construction projects and purchase of goods and limit what specifications Governments can require for goods and services, as well as the qualifications for bidding companies.

She warns that if we do not conform our domestic policies to the TPP terms, the U.S. government would be subject to lawsuits before foreign tribunals empowered to authorize trade sanctions against the U.S. until our policies changed. “Also, any “investor” that happens to be incorporated in one of these countries would be empowered to launch its own extra-judicial attack on our domestic laws in World Bank and UN arbitral tribunals with respect to changes to procurement contracts with the U.S. federal government.”

A letter from Rep. Donna Edwards (D-Md.) and 68 other Congressional Reps to President Obama on May 3, 2012 states in part, “We are concerned about proposals we understand are under consideration in the Trans-Pacific Partnership (TPP) agreement negotiations that could significantly limit Buy American provisions and as a result adversely impact American jobs, workers, and manufacturers…We do not believe this approach is in the best interest of U.S. manufacturers and U.S. workers. Of special concern is the prospect that firms established in TPP countries, such as the many Chinese firms in Vietnam, could obtain waivers from Buy American policies. This could result in larger sums of U.S. tax dollars being invested to strengthen other countries’ manufacturing sectors, rather than our own.”

On November 30, 2012, 24 Senators sent a letter to President Obama outlining guidelines for the TPP and calling for Congressional consultation for the TPP. The letter urged that the TPP:

“Maintain “Buy American” government procurement requirements. The American people, through their elected officials, should not be prohibited from establishing government procurement policies that prioritize job creation in the United States. We hope that you will direct USTR negotiators to ensure that any TPP not restrict “Buyer American” and ”Buy Local” government procurement policies at the Federal or sub-federal level.

Require strong Rules of Origin. The Rules of Origin in the TPP should ensure that only signatories to the TPP will benefit from its increased market access and other provisions so that employment opportunities in the U.S. may be expanded. Non-TPP members must not be allowed to use weak rules of origin as a backdoor way to enter the U.S. market and further depress U.S. job prospects.

Ensure that State-Owned and State-Supported Commercial Enterprises (SOEs) operate on a level playing field.  Given that SOEs are more common in the other TPP countries than in the U.S., the TPP should require that SOEs competing with private U.S. enterprises operate and make decisions on a commercial basis.  The agreement should also incorporate a reporting requirement so that countries have to provide information on the operation of their SOEs in other TPP countries on a regular basis.”

Country of Original labeling is another one of the recommendations I’ve written about in previous blog articles and is the main recommendation of Alan Uke in his book Buying Back America. This would help American consumers make choices when they purchase consumer goods and allow professional procurement specialists in industry and government to choose to support American manufacturers through “Buying American.”

The TPP treaty would exacerbate our trade deficit problem and make it even harder for American manufacturers to compete in the global marketplace. Instead of weakening “Buy American” requirements through additional trade agreements such as TPP, we need to strengthen the requirements.

This drastic curtailment of “Buy American” procurement provisions is another reason why we must make sure Congress rejects any fast-track authority the Obama administration seeks to invoke when it comes time to get final congressional approval for the Trans-Pacific Partnership agreement.
Please join me in opposing granting fast-track authority by signing the petition at the American Jobs Alliance website and contacting your representatives directly at

Making Manufacturing “Cool” for our Youth

Tuesday, April 23rd, 2013

If we want to attract today’s youth to manufacturing careers, We need to make manufacturing “cool,” so they will choose to be part of the modern advanced manufacturing. We need to show them what great career opportunities exist in the industry and expose them to the variety of career opportunities in manufacturing.

Most outsiders have no idea of the variety of management jobs available at manufacturing companies. Besides the usual executive jobs, other management jobs available at medium and large manufacturers are in these areas: operations, plant and facilities, manufacturing and production, purchasing and procurement, sales and marketing, quality, supply chain, lean manufacturing and continuous improvement, human resources, R&D and product development, and safety and regulatory compliance.

In an article in July 2, 2008 issue of Industry Week magazine, John Madigan, a consultant with Madigan Associates, observed, “Jobs paying $20 per hour that historically enabled wage earners to support a middle-class standard of living are leaving the U.S. Public sector aside; only 16 percent of today’s workers earn the $20-per-hour baseline wage, down 60 percent since 1979.

We need to help our youth realize that manufacturing careers, and particularly the advanced manufacturing that now dominates the U.S. industrial sector, creates more wealth than any other industry. Moreover, manufacturing pays higher wages and provides greater benefits, on average, than other industries. For example, in 2010, the average U.S. manufacturing worker earned $77,186 annually, including pay and benefits. The average non-manufacturing worker earned $56,436.

The Society of Manufacturing Engineers Education Foundation (SME) is working to change the image of manufacturing and make it “cool” by sponsoring the ”Manufacturing is Cool” award winning, interactive website, which challenges and engages students in basic engineering and science principles and provides interesting and useful educational resources for teachers. This fun and information rich website was recently “re-engineered” (updated) and marketed around the country. SME has received positive feedback from teachers, parents, and students about its usefulness.

“The explosion of technology and advanced manufacturing processes are evolving faster than it can be learned and applied,” says Bart A. Aslin, CEO, SME Education Foundation. “We designed the Manufacturing is Cool website to inspire, prepare and support young people for careers in advanced manufacturing without patronizing them. We’re giving them access to real-world – people, jobs and technologies, all critical to them finding their place in a global economy.”

The site engages students in basic engineering and science principles and provides interesting and useful educational resources for parents and teachers. Today’s tech-savvy K-12 audience can explore the exciting world of advanced manufacturing engineering 24/7 to learn about the careers it offers and how its advanced technologies affect their daily lives.

In 2011, the SME Education Foundation initiated PRIME® (Partnership Response in Manufacturing Education) as a major national initiative to take a community-based approach to advanced manufacturing education and create strong partnerships between exemplary schools, businesses and organizations. Through its advanced manufacturing education program, SME is re-tooling and building the pipeline with technically skilled workers as business, industry and academia form partnerships and accelerate their collaborative efforts to provide funding, equipment, mentoring, teacher training and co-op programs for high school students to begin manufacturing products in the classroom. The manufacturing sector is on the upswing and public perception of manufacturing as a career is more positive as students see first-hand the kinds of things they are capable of making.
Since 2011, the following schools have been designated as PRIME® schools:

ALABAMA:  Calera High School provides an enrollment of approximately 900 students, grades 9-12, provides a pre-engineering program offers opportunities for student scholastic achievement with science, technology, engineering and math (STEM) curriculum.


Hawthorne High School, Los Angeles, CA – the School of Engineering and Manufacturing has 347 students and has a rigorous educational program built on the Project Lead the Way (PLTW) curriculum

Esperanza High School, Anaheim, California – a comprehensive four-year public high school serving an enrollment of 1808 students in the northeast part of Orange County.

Petaluma High School, Petaluma, CA – a public high school in which students can self-select a pathway leading to certification at graduation, leading to post-secondary opportunities, credit enhancement, or directly to the workforce.

ILLINOIS:   Wheeling High School, Wheeling, Il – is a public, culturally diverse, four-year comprehensive high school with a STEM providing college credit bearing courses and entry level career certifications including information technology, engineering, architecture and advanced manufacturing. It has a newly equipped fabrication, prototyping lab rivaling local manufacturing companies and a team of engineering students who are quickly becoming advanced manufacturing savvy. The lab includes a 3D printer for rapid prototyping, HAAS CNC lathes and mill, CNC Plasma Cutter, CNC training stations, robotic workstation, surface grinder and more.

“Our students graduate with more than a diploma in hand,” says Dr. Lazaro J. Lopez, principal, Wheeling High School. “Students have an opportunity to leave here with 14 college credits and be on their way to securing an associate degree in manufacturing technology as well as NIMS certification in two or three areas, plus all four MSSC safety certifications. Students who want to work after graduation will be able to meet the expectations of the hiring manufacturer.”

INDIANA: McKenzie Center for Innovation and Technology, Indianapolis, IN. The McKenzie Center for Innovation and Technology houses state-of-the art equipment, materials and curriculum. A high concentration of student population is involved with PLTW courses in pre-engineering and biomedical science. Students receive dual college credit and national certifications in their fields of study.

Walker Career Center, Indianapolis, IN offers 24 career and technical education programs equipped with state-of the-art technology. Each program offers excellent instruction and most programs lead to an industry certification or college dual credit which in most cases, is free to their students.

The Walker Center also provides Computer Integrated Manufacturing (CIM) using Chris and Jim’s CIM, a web resource that makes it possible for students, teachers and even industry pros to find solutions to problems they might encounter with this technology. This resource site, created by CIM educators Jim Hanson of Walker Career Center and Chris Hurd of Cazenovia High School in New York, started as a tool to help their students continue to learn outside of the classroom but developed into a knowledge, research and exploration instrument used by many industry professionals. Chris and Jim’s CIM is another way to help educate and train a new generation of engineers to deal with state-of-the-art technology in designing, manufacturing, maintaining, selecting, and procuring manufacturing engineering systems.

IOWA: Cedar Falls High School provides courses that satisfy elective requirements for World Studies, Personal Economics, Health, Practical Arts, and General Administrative. Because of a partnership with Hawkeye Community College, students may enroll in college-level courses taught during the regular school day. Upon successful completion of the course, students will earn both high school and college credit.

MASSACHUSETTS: Westfield Vocational Technical High School recognizes career and technical education as an integral part of the public school system. Westfield students are prepared for careers which are common in modern industry and offer an abundance of job opportunities upon graduation.

MICHIGAN: The Jackson Area Career Center provides its students with career and technical educational classes, industry certifications, and free college credit, and guidance counseling services. More than 38,000 students have experienced Career Center CTE opportunities and possibilities through hands-on and applied learning.

MISSOURI:  Summit Technology Academy, Kansas City – located on the campus of the Summit Technology Center in Lee’s Summit. It is an off-campus pre-professional learning opportunity for high school students seriously interested in the course technology-based courses of study. Professional IT certifications and dual college credit is offered through Metropolitan Community College, University of Central Missouri, Missouri University of Science and Technology, and the University of Missouri-Kansas City.


Centerville High School in Dayton provides a curriculum that includes vocational courses in the Performing Arts, Music, Preparatory College-Career, and the School of Possibilities offering an alternative educational pathway. It also offers 25 Advanced Placement tests in 18 courses in science, mathematics, history, government, language, economics, and psychology.

Kettering Fairmont High School is a public four-year comprehensive high school with a STEM (Science, Technology, Engineering and Math) based education. A majority of students move on to higher education or specialized training. Kettering is an industrial first-ring suburb of Dayton, Ohio that has a local manufacturing base and is in close proximity to Wright-Patterson Air Force Base. The curriculum supports these industries with PLTW manufacturing curriculum.

OKLAHOMA:   Francis Tuttle Technology Center in Oklahoma City encompasses six public school districts serving 11,780 students who may attend Francis Tuttle tuition-free while in high school. The Center works closely with business and education partners with specific focus on workforce needs of the marketplace with the delivery of on time, just-in-time, customized training.

WISCONSIN:  Lynde & Harry Bradley Technology and Trade School is the premier technology and trade school of Milwaukee and offers a broad range of scholastic options, including clear pathways for students into four-year universities, tech/trade education, and apprenticeships.

During the previous recession, the National Association of Manufacturers heard from its members that they were still having trouble attracting employees with the right mix of skills in certain job functions despite layoffs. To learn more, NAM and Deloitte & Touche conducted extensive quantitative and qualitative research across the U.S. They found that an estimated 80 percent of manufacturers reported a moderate-to-serious shortage of qualified job applicants during the recent recession, a problem growing increasingly urgent with the increase in global competition and retirement of Baby Boomers.


They also found that manufacturing has an outdated image, filled with stereotypes of assembly line jobs, that has kept young people from pursuing careers in it. The “Dream It. Do ItTM” campaign was created because these perceptions are out-of-step with manufacturing’s broad range of interesting and financially rewarding careers. Examples include an electrical engineer for a private jet manufacturer, a product developer for a candy manufacturing plant, or a designer at an MP3 manufacturing company.

NAM’s Manufacturing Institute/Center for Workforce Success received almost $500,000 in November 2004 from Elaine Chao, Secretary of Labor, for this campaign. Over a period of 36 months, the campaign created, tested, and disseminated a growing set of creative materials. These include radio advertising spots, billboard designs, newspaper and magazine ads, student and parent brochures, and a style-branding guide. The materials are ready to use and provide the national brand to local users.

The campaign has formed strong and committed coalitions with local civic, political, education, and business entities; launched a focused advertising campaign; created a world-class website on the array of highly paid manufacturing jobs; and formed local partnerships with community colleges, technical schools and universities for students pursuing manufacturing careers.

NAM’s “Dream It. Do It TM” Manufacturing Careers Campaign is currently operating in the following regions:

Phoenix, Arizona

Will County, Illinois

Southeast Indiana 


Western Michigan
West Central Minnesota
Kansas City, Missouri

Chautauqua County, NY

Northeast Ohio

Pennsylvania Upstate South Carolina
The Tennessee Valley
North  and South Central Texas
Southwest Virginia
Washington State 


The SME and NAM programs described above will help expose our youth to the modern manufacturing environment and change the image of manufacturing to one that is “cool” and full of exciting career opportunities for our youth.


Innovative Programs Provide Career and Technical Education in High Schools

Tuesday, April 16th, 2013

According to a 2012 Pew Research Center analysis of census data, for the first time, a third of American 25- to 29-year-olds have earned at least a bachelor’s degree. That share has been slowly edging up from fewer than one-fifth of young adults in the early 1970s to 33 percent this year. What happens to the other two-thirds of young adults? In Germany, they typically hold an occupational certification by the age of 20, but in the United States, non-college grads are often left without marketable skills or qualifications.

In his State of the Union address, President Obama said, “Tonight, I’m announcing a new challenge to redesign America’s high schools so they better equip graduates for the demands of a high-tech economy. And we’ll reward schools that develop new partnerships with colleges and employers, and create classes that focus on science, technology, engineering and math — the skills today’s employers are looking for to fill the jobs that are there right now and will be there in the future.”

There are already a number of innovative high schools across the country that are pioneering a model for career and technical education that has little to do with the narrow vocational classes of yesteryear, like wood shop and auto shop. Instead, at Linked Learning schools in California, at the MET schools in Rhode Island, and at Tech Valley High outside Albany, high school students complete internships in real workplaces, exploring fields as diverse as baking, engineering, and biotechnology. Students have the opportunity to check out more than one profession so they can see how adults use their education in the workplace. This helps students stay motivated to earn a degree and introduces them to the behaviors and practices specific to the working world.

California is one of the states that put vocational training back into the curriculum at high schools and community colleges. During his terms as California’s governor from 2003-2010, Arnold Schwarzenegger identified workforce skills, referred to as Career Technical Education (CTE), as a priority for California. The State plan specifies learning goals in 58 career pathways organized around 15 industry sectors. The CTE is delivered primarily through K-12/adult education programs and community college programs and includes the following:

K-12/Adult Programs:

  • Elementary school awareness and middle school introductory CTE programs
  • High school CTE, offered through 1,165 high schools in single courses, in course sequences or through over 300 integrated “learning communities”
  • ROCPs offering career pathways and programs through 74 ROCPs
  • Adult education offered through 361 adult schools and over 1,000 sites
  • Apprenticeship offered through over 200 apprenticeship program and adult schools

Community College

  • Occupational programs offered at all 109 colleges, leading to certificates, associate degrees, and transfer to four-year universities
  • Noncredit instruction for short-term CTE programs offered by 58 colleges
  • Apprenticeship offering over 160 apprenticeship programs at 39 colleges
  • Middle College High Schools (13) and Early College High Schools (19)
  • Tech Prep programs delivered through 80 Tech Prep “consortia,” comprising 109 colleges and their feeder high schools

As a result, California developed “Linked Learning,” which is an approach that is transforming education for California students by integrating rigorous academics with career-based learning and real world workplace experiences. Linked Learning ignites high school students’ passions by creating meaningful learning experiences through career-oriented pathways in fields such as engineering, health care, performing arts, law, and more.

The Linked Learning pathway is defined as:  A multiyear, comprehensive high school program of integrated academic and career technical study that is organized around a broad theme, interest area, or industry sector. Pathways connect learning with students’ interests and career aspirations, preparing them for the full range of post-graduation options including two- and four-year colleges and universities, apprenticeships, formal employment training, and military service.

In 2012, sixty three districts and county offices of education in California committed to making Linked Learning a district-wide improvement strategy and participate in the state Linked Learning Pilot Program, authorized by Assembly Bill 790. The scale of the state Linked Learning Pilot Program will give many more students in more regions around the state access to Linked Learning. When the pilot is fully implemented, Linked Learning will be available to more than one third of the state’s high school students – that’s approximately 700,000 students.

Linked Learning can be implemented through various models such as the California Linked Learning District initiative, which includes nine districts that have already implemented the Linked Learning approach:

  • Antioch USD
  • Long Beach USD
  • Los Angeles USD, Local District 4
  • Montebello USD
  • Oakland USD
  • Pasadena USD
  • Porterville USD
  • Sacramento City USD
  • West Contra Costa USD

Additional models include California Partnership Academies, career academies, National Academy Foundation academies, charter schools, and small-themed schools to name just a few. Today in California, 500 California Partnership Academies are organized around one of the state’s California’s 15 major industry sectors, and another approximately 300 career academies are in operation. Regional Occupational Centers and Programs (ROCPs) play an important part in many of these academies. In many other high schools, ROCPs are experimenting with innovative approaches to integrate academic and technical education.

While my hometown of San Diego hasn’t implemented the Linked Learning approach, Clairemont High School has an Academy of Business & Technology (AOBT), which is a “school within a school” that focuses on business, computer, and communication skills. The three-year program provides college-prep core classes and business career-technical electives to provide students the technological, financial, and communicative skills necessary to succeed in a college and career environment.

The academy program is committed to providing students with an array of unique educational activities and opportunities that are not typically incorporated into general education courses such as: • Internships in the business field • Mentorships with community partners • Entrepreneurship training • Instruction in finance and economics • Online business simulations • Field trips to businesses and colleges • Guest speakers on various careers • Job interview & resume guidance • Computer skills in Microsoft applications • Public speaking preparation  • Project-based group assignment • Team-building and leadership exercises • Problem-based learning projects • Group simulations.

On a nationwide basis, the non-profit organization Project Lead The Way® (PLTW) has been working since 1997 to promote pre-engineering courses for middle and high school students. PLTW forms partnerships with public schools, higher education institutions, and the private sector to increase the quantity and quality of engineers and engineering technologists graduating from our educational system. The PLTW curriculum was first introduced to 12 New York State high schools in the 1997-98 school years. A year later, PLTW field-tested its four unit Middle School Program in three middle schools. Today, there are over 400,000 students enrolled in programs in all 50 states and the District of Columbia.

PLTW has developed innovative and mutually beneficial partnerships with more than 100 prestigious colleges and universities, called University Affiliates, to facilitate the delivery of the PLTW programs. They provide and coordinate activities such as professional development, college-level recognition, program quality initiatives, and statewide/regional support and communication.

PLTW has nearly 100 leading corporate sponsors, including 3M, BAE Systems, Boeing, Caterpillar, Chevron, Intel, Lockheed Martin, Northrop Grumman, Qualcomm, Rockwell Automation, Solar Turbines, and Sprint. Some of non-profit sponsors are the Kauffman Foundation and the Society of Manufacturing Engineers Education Foundation. Corporations and philanthropic organizations generously provide PLTW with:

  • capital resources which it allocates to schools so that they may deliver leading-edge STEM curriculum, technology, materials and equipment to students;
  • access to experienced and talented employees who assist teachers in PLTW classrooms.

Another PLTW program sponsored by the Society of Manufacturing Engineers Education Foundation and other organizations is the Gateway Academy, a one- or two-week day camp for 6th – 8th graders that is a project based, hands-on curriculum designed by PLTW to introduce middle school students to the fundamentals of science, technology, engineering and math (STEM) learning. The camp typically includes team-building exercises, individual and team projects, and utilizes the latest technology to solve problems. The camp is hosted by high schools or middle schools offering PLTW programs, such as Gateway To Technology (GTT) or Pathway To Engineering (PTE).

Campers work together in a fun, exciting environment using leading-edge technologies to sample such disciplines as robotics, aeronautics and eco-design. They brainstorm ideas, solve problems and build bridges, race cars and other working models.

Participation in a Gateway Academy prepares students for the middle school Gateway to Technology pre-engineering curriculum. The PLTW Middle School program is called Gateway To Technology, consisting of nine-week, stand-alone units, which can be implemented in grades six through eight, as determined by each school. The curriculum exposes students to a broad overview of the field of technology. The units are:

•           Design and Modeling

•           The Magic of Electrons

•           The Science of Technology

•           Automation and Robotics

•           Flight and Space

If all 50 states would establish career technical education in their high schools based on the successful PLTW curriculum, we could eliminate the skills shortage of manufacturing workers within the next five to six years and prepare the next generation of manufacturing and biotech workers to ensure that we have enough skilled workers for manufacturers to employ as more and more companies return manufacturing to America from outsourcing offshore and replace the “baby boomers” as they retire over the next 20 years.

How we can Solve the Skills Shortage and Attract the Next Generation of Manufacturing Workers

Tuesday, April 2nd, 2013

We lost 5.7 million manufacturing jobs between the year 2000 and 2010, and over 57,000 manufacturing companies went out of business. We have only gained about 500,000 manufacturing jobs since January 2010, so some ask why we have nearly 600,00 jobs going unfilled when the unemployment rate for the manufacturing industry jumped is still ranging from 6.4 percent in November 2012 to 7.2 percent in February 2013. The main reasons are:

  • Unemployed workers are mainly from industries that have been decimated by trade deficits with China and American manufacturers choosing to outsource manufacturing offshore.
  • Fewer young people choosing manufacturing as a career choice because of poor image
  • Attrition from retirement that is getting worse as baby boomers started to retire

First, a large percentage of the people who lost their jobs came out of industries that were decimated by Chinese product dumping and the offshoring of manufacturing – textiles, furniture, tires, sporting goods, and the garment industry, to name just a few.

Most of these industries were dominated by large manufacturers employing hundreds to thousands of workers in plants located in the northeast, Midwest, and south. These workers either worked on assembly lines or utilized specific skills suited to their industries. In some cases, a textile plant, furniture plant, or automotive plant was the only large employer in a town. When the plant closed, workers either had to take whatever other job they could find or relocate to another area. In most cases, these workers didn’t have the specific skills needed in high-tech manufacturing industries.

An added blow was the decimation of the automobile and auto parts industry during the Great Recession when North American auto production dropped from a high of 17 million vehicles per year down to below 10 million vehicles in 2008 before climbing back up to about 13 million in 2012.

Second, manufacturing’s tarnished image has led young people entering the workforce to choose other career paths. In an article titled, “What the shortage in skilled manufacturing workers means to a hungry industry” of the e-newsletter Smart Business, Kika Young, human resources director at Forest City Gear Co. Inc. of Rockford, IL, said “Most people in Gen Y out of high school don’t think of manufacturing as a career or as a good option. They don’t think of it as glamorous; they think of it as dark and dingy and dirty and aren’t interested in going into that.”

Emily Stover DeRocco, president of The Manufacturing Institute of Washington, D.C., said, “It’s absolutely true that the image and the definition of manufacturing in this country has not kept up with the industry.” She added, “Companies need to invest more in employee training and make workforce skills a top strategic priority. Our education system must also do a better job aligning education and training to the needs of employers and job seekers. In the face of a global recession and intense international competition, American manufacturers must differentiate themselves through innovation and a highly skilled workforce.”

Third, the attrition of skilled workers through retirement, death, and disability year after year is compounding the problem. Harry Moser, retired president of GF AgieCharmilles and founder of the Reshoring Initiative, estimates that “about 8 percent of the manufacturing workforce is lost each year due to retirement, promotion, career changes, disability, and mortality.” In the machining industry, this means a loss of “about 20,000 to 25,000 skilled machinists per year…In contrast, only about 8,000 per year receive sufficient machining training in high school, community college and apprentice programs to be considered good recruits.”

In 2011, the U.S. Bureau of Labor statistics estimated that 2.8 million, nearly a quarter of all U.S. manufacturing workers, are 55 or older. While manufacturing has led the United States out of the recession, the improvement has been a mixed blessing because as more skilled workers are needed, the supply is limited because baby boomers are retiring or getting close to retirement. What makes the situation worse is that there are not enough new ones to replace them because the subsequent generations were smaller and fewer chose manufacturing as a career.

The convergence of all of these factors has resulted in an insufficient number of workers trained for advanced manufacturing jobs. It is more of a skills gap in the specific skills needed by today’s manufacturers than a shortage of skilled workers. In the past 15 years, the manufacturing industry has evolved from needing low-skilled production-type assembly workers to being highly technology-infused.

The 2012 ManpowerGroup annual Talent Shortage Survey revealed that 49 percent of U.S. employers are experiencing difficulty filling mission-critical positions within their organizations despite continued high unemployment. According to the more than 1,300 U.S. employers surveyed, the positions that

are most difficult to fill include Skilled Trades, Engineers and IT Staff, all of which have appeared on the U.S. list multiple times since the survey began in 2006.

Jonas Prising, ManpowerGroup president of the Americas, said, “This skills mismatch has major ramifications on employment and business success in the U.S and around the globe. Wise corporate leaders are doing something about it, and we increasingly see that they’re developing workforce strategies and partnerships with local educational institutions to train their next generation of workers.”

Training to Address Skills Shortage:

According to a 2011 U.S. Government Accountability Office study of fiscal year 2009, the federal government had 47 programs run by nine different agencies. The GAO noted that more information is needed to measure the true effectiveness of the programs. “Almost all of the 47 programs tracked multiple outcome measures related to employment and training, and the most frequently tracked outcome measure was ‘entered employment,’ “the agency stated. “ However, little is known about the effectiveness of employment and training programs because, since 2004, only five reported conducting an impact study, and about half of all the remaining programs have not had a performance review of any kind.”

Obviously, we could make government work better and save money in the process by consolidating some of these programs and giving some of the money to the states for programs that work best for their workers. However, it doesn’t necessarily mean programs can be combined. It might not make sense, for example, to combine the “Disabled Veterans’ Outreach Program” with the “Migrant and Seasonal Farmworkers Program,” or the “Native American Employment and Training Program” with the “National Guard Youth Challenge Program.” In addition, the programs are not equal in size or scope. The GAO reported that seven programs accounted for 75 percent of the $18 billion spent on job training, while two programs (“Wagner-Peyser funded Employment Service” and “Workforce Investment Act Adult”) served about 77 percent of all participants.

However, we don’t need to rely solely on government-funded training for manufacturing jobs. A great deal has already been done industry, trade and professional organizations, colleges, and universities to train and retrain today’s workers and prepare the next generation of manufacturing workers.

For example, the National Institute for Metalworking Skills (NIMS) was formed in 1995 by the metalworking trade associations to develop and maintain a globally competitive American workforce. NIMS sets skills standards for the industry, certifies individual skills against the standards, and accredits training programs that meet NIMS quality requirements. NIMS operates under rigorous and highly disciplined processes as the only developer of American National Standards for the nation’s metalworking industry accredited by the American National Standards Institute (ANSI).

NIMS has a stakeholder base of over 6,000 metalworking companies and major trade associations in the industry. The Association for Manufacturing Technology, the American Machine Tool Distributors’ Association, the National Tooling & Machining Association, the Precision Machine Products Association, the Precision Metalforming Association, and the Tooling and Manufacturing Association have invested over $7.5 million in private funds for the development of the NIMS standards and its credentials.  The associations also contribute annually to sustain NIMS operations and are committed to the upgrading and maintenance of the standards.

NIMS has developed skills standards in 24 operational areas covering the breadth of metalworking operations, and there are 52 distinct NIMS skill certifications. The Standards range from entry to a master level. All NIMS standards are industry-written and industry-validated, and are subject to regular, periodic reviews under the procedures accredited and audited by ANSI. NIMS certifies individual skills against the national standards and requires that the candidate meets both performance and theory requirements that are industry-designed and industry-piloted.
NIMS accredits training programs that meet its quality requirements. The NIMS accreditation requirements include an on-site audit and evaluation by a NIMS industry team that reviews and conducts on-site inspections of all aspects of the training programs, including administrative support, curriculum, plant, equipment and tooling, student and trainee progress, industry involvement, instructor qualifications and safety. Officials governing NIMS accredited programs report annually on progress and are subject to re-accreditation on a five-year cycle.

The Society of Manufacturing Engineers (SME), the world’s leading professional society advancing manufacturing knowledge, also provides the following professional certifications:  Manufacturing Technologist, Manufacturing Engineering, Engineering Manager, Lean Certification (Bronze, Silver, and Gold), and Six Sigma. SME’s Certified Manufacturing Technologist program is utilized as an outcome assessment by numerous colleges and universities with Manufacturing, Manufacturing Engineering or Engineering Technology programs.

In 2010, the Society of Manufacturing acquired Tooling University LLC (Tooling U) based in Cleveland, Ohio to provide online, onsite, and webinar training for manufacturing companies and educational institutions. With more than 400 unique titles, Tooling U offers a full range of content to train machine operators, welders, assemblers, inspectors, and maintenance professionals. These classes are delivered through a custom learning management system (LMS), which provides extensive tracking and reporting capabilities. The competencies tie the online curriculum to matching hands-on tasks that put the theory to practice.

The Fabricators and Manufacturers Association, International (FMA) champions the success of the metal processing, forming, and fabricating industry.  FMA educates the industry through the following programs:

FabCast – FMA’s webinar platform utilizes Internet connection and telephone to deliver live, interactive technical education programs directly to manufacturers on such topics as laser cutting, roll forming, metal stamping, etc. Companies can train their whole team at once, even from multiple locations. Companies can break up full days of instruction into modules and spread out over a period of time (i.e. two hours four days a week, four hours once a week for a month, etc.).

FMA also offers on-site, live training conducted at companies on their equipment as well as on-line training (e-Fab) that allows a company to get the training that they need, when they need it. E-Fab courses combine a full day’s worth of instruction by FMA’s leading subject matter experts with the flexibility of online delivery, available 24/7, 365 days a year.

FMA provides a Precision Sheet Metal Operator (PSMO) Certification – the metal fabricating industry’s only comprehensive exam designed to assess a candidate’s knowledge of fundamental precision sheet metal operations. Fabrication processes covered in the exam include shearing, sawing, press brake, turret punch press, laser cutting, and mechanical finishing.

Attracting the Next Generation of Manufacturing Workers:

If we want to attract today’s youth to manufacturing careers, we need to change their perceptions about what the manufacturing industry is like and show them what great career opportunities exist in the industry. We need to expose them to the variety of career opportunities in manufacturing and help them realize that manufacturing careers pay 25-50 percent higher than non-manufacturing jobs, so they will choose to be part of modern manufacturing.

We need to reacquaint youth with the process of designing and building products from an early age and provide them with the opportunities to learn in both traditional and non-traditional ways. Here are some suggestions:

Conduct manufacturing summer camps – In 2011, the Fabricators and Manufacturers Association, International (FMA) Nuts, Bolts and Thingamajigs Foundation (NBT) and the National Association for Community College Entrepreneurship (NACCE) partnered to launch a unique summer camp program called Gadget Camp, where teenagers learn how to build things from concept to creation. Attendees are required to design a product through computer-aided design (CAD) technology and oversee the design to completion. The initial summer camp will eventually develop into a national program with as many as 300 locations across the United States.

Restore shop classes to our high schools – The elimination of these courses from our school systems has inevitably had a negative impact on the way we view making a living with our hands. Project Lead The Way® (PLTW) has been working since 1997 to promote pre-engineering courses for middle and high school students. PLTW forms partnerships with public schools, higher education institutions, and the private sector to increase the quantity and quality of engineers and engineering technologists graduating from our educational system. The PLTW curriculum was first introduced to 12 New York State high schools in the 1997-98 school years, and today, the programs are offered in over 1,300 schools in 45 states and the District of Columbia.

Improve the image of manufacturing careers – The National Tooling and Machining Association (NTMA) is another trade association that has a program to encourage youth to consider manufacturing as a career. NTMA is the Founding Sponsor of an exciting educational program that provides unlimited career awareness experiences in advanced manufacturing technology for students from middle school through college age. The approach has three components: a robotics curriculum based on national standards, teacher training workshops, and competitive events where students showcase their custom-built machines and compete for top honors. NTMA has six active regional leagues in their National Robotics League, a competition of battling robots that generates huge excitement among high school students.

Establish Apprenticeship Programs – In 2011, NIMS launched a new Competency-based Apprenticeship System for the nation’s metalworking industry. Employers are able to customize training to meet their own needs while maintaining the national integrity of apprenticeship training. Developed in partnership with the United States Department of Labor, the new system is the result of two years of work. Over 300 companies participated in the deliberations and design. The new National Guideline Standards for NIMS Competency-based Apprenticeship have been approved by the Department of Labor. NIMS has trained Department of Labor apprenticeship staff at the national and state level in the new system.

Portray manufacturing careers as fun and exciting – the convergence of cloud computing, mobile apps, and gamification within the manufacturing sector is in its infancy. Gamification is the use of game thinking and game mechanics in a non-game context to capitalize on youth’s obsession with video games. The best example is Plantville, a new online gaming platform that simulates the experience of being a plant manager, introduced by Siemens Industry, Inc. in March 2011. Players are faced with the challenge of maintaining the operation of their plant while trying to improve the productivity, efficiency, sustainability and overall health of their facility.

The existing programs described and recommendations outlined in this article are a good start to ensure that we have enough skilled workers for manufacturers to employ as more and more companies return manufacturing to America from outsourcing offshore and replace the “baby boomers” as they retire over the next 20 years.